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Calculate the transfer price

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Question - PT. Baju Koko has two divisions, a spinning division and a shirt-making division. Each month the spinning division is able to produce 200 meters of fabric, the shirt division's production capacity is 100 meters of fabric. The spinning division buys yarn at a price of Rp. 5,000/meter, and the cost of production Variable Cost Rp. 500,- Fixed Cost Rp. 1500,- The market price of the shirt division is Rp. 13,000, Variable Cost is Rp. 1,000, Fixed Cost Rp. 600

Required -

a. Calculate the transfer price based on the market price from the spinning division to the shirt division.

b. Calculate transfer price cost based plus 13%.

c. Calculate Transfer price based on negotiation.

Reference no: EM133186984

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